How to unleash top investment talent and teams

Investment management firms have seen more change in the last five years than in the previous five decades. New asset classes, significant regulatory and technological developments, pandemic-related market and workplace volatility, as well as evolving client expectations have all pushed investment managers well and truly into the era of ‘never normal’.

In this environment, trading strategies have become more dynamic, with firms increasingly trading across multiple asset classes, while relying on advanced algorithms to analyse and adapt in real-time to changing conditions. Agility has become the critical currency for firms to keep their place as trusted financial partners. 

More often than not, these trading strategies are devised by people and made possible by technology. Investment firms are sophisticated users of data and analytical tools to help decide where and when to deploy funds. In recent years these capabilities have been greatly enhanced through artificial intelligence (AI) and machine learning (ML), enabling investment strategies to better predict and adapt faster to changes in the market.

Now we’re seeing that appetite for more dynamic and agile investment strategies reflected in how firms manage the people responsible for those strategies. Investment companies are deploying equally dynamic and agile data-driven models, analytical tools and AI and ML technologies to manage their most critical asset: their people.

It pays to have the best people

However sophisticated these models are, it is the quality of the employees who build and deliver those models that gives firms the edge in the marketplace and the fight for that top talent is fierce. Investment leaders speak of escalating competition for talent, from new and traditional rivals, as well as tech companies, and headlines highlight $120 million pay deals as hedge funds fight to hire and retain the best traders.

To fully harness investment talent it’s essential to address certain challenges. These include highlighting the capabilities of your workforce, creating flexible staffing approaches for dynamic economic situations, identifying skill gaps and optimising career development paths.

When it comes to talent — whether recruiting, redeploying or retaining — it helps to have access to insight. With technological change creating new requirements and making old skills obsolete at pace, a deep and real-time understanding of people data is more important now than ever before. Because to build a talented team, firms need to know what skills they have, what skills they need and where the gaps are. 

Technology has, in part, created a more dynamic talent environment in which the skills required for success are changing at unprecedented rates, and it also provides an opportunity to help organisations recognise and build those new skills capabilities. AI and ML tools present significant opportunities to enhance talent management strategies, allowing investment firms to analyse their people data at scale, predict future needs and better understand how and where to assign ‘the right person for the job’. 

The first step for many organisations on this journey is to obtain a clear and current understanding of each employee’s skills and performance. The best firms are combining HR and finance data when analysing performance to understand the individual more accurately and how their contribution affects the bottom line.

AI and ML make it possible to combine and analyse data from a wide range of sources to build a picture of hundreds of traits and insights across an organisation quickly. This enables organisations to see the in-depth strengths of every employee, to infer and verify new areas of expertise and match people with the right tasks or training to excel.

Understanding the value of talent

When making almost any people-related decisions it is useful to understand not just the cost, but the value of that talent too. It’s not just what these people deliver on the field that matters, but sometimes the support and cohesion they bring to a champion team.

That talent needs to feel heard and fairly rewarded. Decisions around bonuses and career progress must be objective and just, accurately reflecting each individual's contribution to business success, and firms need to truly listen to and understand employees to help them perform at their best. 

Seismic shifts in the marketplace mean that the skills investment firms need to succeed have changed too, and will continue to change. Investment firms need active and ongoing skills planning to maintain a competitive edge, a deep understanding of the true value each team member brings and the ability to ensure agility is reflected in their talent strategy.

In fact, agility is an increasingly crucial component when it comes to talent. In investment, a few brilliant individuals can have a sizable impact on success. Knowing how to keep the very best people engaged, planning appropriately for succession, upskilling employees to achieve more, and maintaining a high-quality talent pipeline has never been more vital for success.